The quiet discussions between the U.S. Congress and the White House about the upcoming fiscal cliff ended last week with no deal and no date to meet again, a not particularly auspicious beginning.

Congressional leaders, senior White House staff and the Treasury Secretary met to talk about a budget deal to forestall a government shutdown on October 1; remove budget caps that would mandate $120 billion in budget cuts, and increase the debt ceiling.

Congress wants a two year agreement with the White House, to remove the threat of a government fiscal crisis past the 2020 elections. Apparently, the Administration wants a one-year deal. And while pushing for more money for defense, it appears willing to keep existing spending levels with a “continuing resolution” rather than a broad spending agreement.

Unfortunately, this strategy is not the best one for markets; it would—if agreed to—at least delay a government crisis.

Investors should focus on the G-20 meeting in Japan between Presidents Donald Trump and Xi Jinping. The American president reported that the two talked this past week and that it was a good conversation that led to the agreement to meet. President Trump also reported that the two directed staff to meet this week, though there haven’t been any repo...

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